Avison Young study finds major potential for office conversion to residential

TORONTO — New analysis from Ontario-based Avison Young suggests up to 34 per cent of office buildings in 14 major North American markets could be potential candidates for adaptive reuse.

Looking at more than 26,000 buildings, office to residential conversions could open the door to potential housing for thousands of families in as many as 8,996 properties, the firm stated.

“Adaptive reuse is an important conversation we are having around the art of the possible, to demonstrate how this potential solution contributes to placemaking and to the revitalization and vibrancy of our neighbourhoods, particularly our downtown cores,” said Avison Young principal Sheila Botting in a recent release. “We must reimagine how we want to live, work and play. Adaptive reuse is one of the key components of how we do that as a community.”

Using a combination of its proprietary Avison Young analytics and third-party analytics, the firm identified buildings built before 1990 and those with floor plates below 15,000 square feet, two anchoring criteria that tend to help isolate buildings that offer long-term potential for conversion. Avison Young applied the search to 10 U.S. markets and four Canadian markets, including those that have witnessed heightened interest in the possible solutions provided by office conversions, like Calgary, Manhattan and San Francisco.

“Beyond age and floor plate, other criteria must be considered, such as specific building feasibility, costs, location and surrounding amenities, to determine prime candidacy,” said Avison Young principal Stephen Silverstein. “That’s where conversations with our consultants, project and construction managers, asset managers and brokerage teams come into play, although this initial data set provides a clear snapshot as a starting point of what could be possible for these markets.”

Adaptive reuse is key to helping neighbourhoods and downtowns bounce back post-pandemic, the firm said.

“People are rethinking how they use office buildings and how they view the entire downtown,” stated Botting. “Whereas most downtowns have mainly office buildings, a mix of uses provides much needed energy and vibrancy – and that’s where adaptive reuse provides a tremendous opportunity to reimagine great spaces for people to connect.”